The downtown condo market continues to lead all rental activity. The area bounded by Bloor St. to the north, and between the DVP and Dufferin to the west accounted for 43% of all condos rented on TREB in the Third Quarter of 2019. This figure was 22% higher than for the same period in 2018. This supports our view that most new condos downtown are being absorbed into the rental market.
Further proof can be found in the rental rates for various sizes of condos. Studio prices are now averaging $1950 per month (which is just under $5/ft per month). The one-bedroom market starting at $2300, without parking or a den, is over $4.50/ft per month.
The two-bedroom market ranges from a low of $3100 per month to almost $3600 when you include parking and a den. The three-bedroom market remains in the $4500 per month range.
For investors, expect rents to average $4.50/ft per month as the bottom ask for any purchase.
We are now in the Fall market when rents usually soften. But strong demand has resulted in rents remaining at summer levels. While the rental market does show a number of list price (rent) decreases, it is because investors, aware of rent controls, want to maximize the rent at the outset so don’t be fooled by this trend.